CIO 1-on-1 In 1999, Star Cruises became one of the first in its industry to implement ERP software.
With about 15,000 full-time employees and a combined fleet of 21 ships in service and under construction, Star Cruises needed an integrated system that could better manage information. It chose SAP, whose ERP (enterprise resource planning) software centralized Star Cruises' business processes and integrated information from various functional areas like financials, procurement and human resources.
Incorporated in September 1993, Star Cruises has offices around the world, including Asia, Europe, United Arab Emirates and the United States of America.
Over the years, Star Cruises has continued to leverage technology in areas that benefit the business. This year, the regional luxury cruise liner's tech priorities will be anchored in a few major areas.
In an exclusive interview with ZDNet Asia, Kenny Ng, vice-president of IT, reveals that he is focused on gaining greater information visibility from its SAP software. "This allows us to detect trends, patterns and obtain other useful information that can help our top management to formulate business strategies," he explains.
Ng says he is also looking at thin-client infrastructure so that the company can deploy services "more cost-effectively", along with B2B initiatives to ensure greater collaboration with its partners worldwide. "The intention is to get connected to the global distribution systems so that we can enlarge our reach to non-traditional agents," he notes.
Ng also describes to ZDNet Asia the tech decision-making process at Star Cruises and highlights what he thinks is one the most-hyped technologies.
Q. How do you decide if you should implement a certain technology? What's the process like and how do you justify tech investments?
In the past, the typical mindset of users was that IT knew it all. They depended on us as the key decision maker to provide the technology solution to their business needs. Today, we are trying to change that mindset. We want to involve the business units in all project solution assessments. We will involve the business unit head, as well as one or two key users. When there is a project request, we work closely with the business unit heads to understand their requirements and the objective of the technology that they want to procure. Our IT unit still oversees the project paper approval [process], because we understand the technology and business processes. We put together the paper and then [submit it] to a small committee that will do verification endorsement. We recommend the technology to the CFO and finance committee which approves the project.
Aside from costs, what other issues do you have to consider when getting approval for a project?
For certain projects that involve high investment, those typically are difficult to get management buy-in. The management needs to clearly understand the business objectives. You wouldn't want to invest a million dollars in a solution that benefits only certain parts of the business. The solution should benefit at least two or three major groups of the organization. We play the role of moderator, advising the committee on the solution put forth, as well as other benefits that the other departments will gain from this solution. Once they see that clearly, they will see the returns on the investment (ROI).
How difficult is it to justify ROI today?
ROI is pretty subjective. But typically, ROI for an ERP implementation measures the productivity [gains], because you're talking about business process integration. Processes that used to take half an hour to do, now takes only about 20 minutes. So that is a productivity gain for us. But we also think ROI equals to cost avoidance. Over at Star Cruises, we have the mindset to invest gradually. What is a must-have to the operations, we will invest. Those that are nice to have, we will consider only when we have more budget.
Compared to a few years ago, is it as difficult to convince top management to buy into a certain technology?
Thankfully, our senior management is pretty tech-savvy. They understand the need to use technology to enable certain processes. Take for example our ship operations, and where we call on our homeports and we have access to the infrastructure we want. There is no issue about having to communicate with the ships or sending data across to one other. But in areas where we fall out of the communications [range], it is always a challenge. At a certain destination port, where the ship doesn't have a homeport terminal facility, we cannot get connected to the IT infrastructure. Hence, we must find ways to get the information from the ship back to headquarters. And that's where we have to be more innovative in deploying [technology]. We could either use satellite or wireless solutions to connect the ship back to the homeport terminal. Our homeports are located in Singapore and Hong Kong, while Port Klang is our operating headquarters.
What is your organization's take on outsourcing?
We haven't done any real outsourcing work yet, but we are looking into outsourcing areas like PC helpdesk and support. I do not need to hire IT professionals to do helpdesk management, and I believe that the vendors can easily do this. At the end of the day, the cost-benefit analysis study must be done to see whether we will actually gain from outsourcing.
Which technology is the most over-hyped today?
In my opinion, IP telephony is one of them. Everyone agrees that the trend is towards convergence, where you can put multimedia, voice and data over a single network. IP telephony, in that sense, can drive voice over the IP network. But it only applies to a certain group of users, and [it depends on the implementation]. For an organization like ours where we have already deployed a hybrid infrastructure of data and voice, more cost-benefit studies have to be done. We will not only need to invest in more switches, but we'll also need to look at the availability of skillsets in network management to handle the additional services. If it's a totally fresh setup, the opportunity to invest in IP telephony is a lot more attractive.
Cordelia Lee is a freelance correspondent based in Malaysia.